It's Tuesday The Thirteenth -- What's Kashkari Thinking? September 13, 2022

CPI: oh, oh. Slightly worse than expected.
80% chance: Fed raises "rate" 75 basis points next month.
20% chance: Fed raises "rate" 100 basis points next month.
April rate: 4.3% or thereabouts.
Futures: Dow down 500 points.

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Before CPI Comes Out

Kashkari: "Jay, we're not seeing the pain."

Note: SRE almost never trades pre-market, so this is not unusual.

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America 

For the archives.

Americans are in a foul mood. Consumer confidence is at recessionary levels, even though there’s no recession. Seventy percent of Americans think the nation is heading in the wrong direction, with only 23% saying it’s on the right track.

Okay, fine. Inflation is a pain. Politics are toxic. COVID may never end. But the United States is doing better than just about any other place in the world, at a time of war and other massive disruptions. If you don’t like it here, ask yourself, where are things better?

The US inflation rate is 8.5%, and probably on the way down. In Europe, it's 8.9% and probably on the way up. In the UK, inflation is 10.1%. Europe is either in a recession or about to enter one. In the United States, growth has slowed, but the job market remains remarkably strong and employers still can’t get enough workers.

Other areas:

• Ukraine
• China Covid lockdown: 313 million Chinese in lockdown -- almost as many as entire US population; China's Covid-19 stagnation: no end in sight
• Biden "killing" China with tech embargo
• Japan: still with Covid travel restrictions
• Canada: high inflation; recession risk, hyperactive central bank jacking up interest rates
• Scanndiianavia; cnsistently ranks as the world's happiest region but they also have to contend with the worst neighbor, Russia
• US Congress spending a lot of money no things some people want; yet the US tax burden is amnog the lowest in the wrold
• US economy has fully regained all the jobs lost during the Covid downturn
• US economic output is higher than pre-Covid levels
  
•  gasoline prices which hit $5.02 / gallon in June (2022), not at $3.72 (here in north Texas, $2.99)
  
• Americans with health insurance: 91%; seven points higher than ten years ago
• US poverty rate close to record lows

For now, let's ignore:

• southern surge
• debt
• disconnect between SCOTUS and much of the US
• lack of workers